1. Calculations & Record Keeping
Business Finance
Calculations
&
Record Keeping

2. Fixed and Variable Cost
Fixed cost – set amount regardless of production or sales
Variable cost – amount changes for quantity used or time spent

3. Lemonade Stand Activity
Step 1: Brainstorm all the items you would need to start a lemonade stand
Answer: Table, chair, pitcher, lemonade, water, sugar, ice, cups, sign

4. Lemonade Stand Activity
Step 2: Divide the items into fixed costs and variable costs
Fixed: table, chair, pitcher, sign
Variable: water, ice, lemonade, sugar, cups

5. Lemonade Stand Activity
Step 3: Create a formula to calculate the cost of running your lemonade stand for the first day of business
Table + Chair + Pitcher + Sign + X Water + X Ice + X Lemonade + X Sugar + X Cups = Cost
Total Fixed + (Variable)(Number Made) = Cost

6. Your Project
On the T-Chart provided list all of your fixed costs (spent before you open your doors) on the right and variable costs (spent as you operate your business) on the left
Be meticulous and list things item by item. Later we will group some things (pens, paper, etc. as office supplies)